After signing the sales contract, , it is essential that the buyer communicates with his chosen solicitor and provide him a copy of the signed contract. Sellers usually require buyers to pay the deposit after the contract has been signed. One business day after the contract is signed, the cooling period starts, within which the buyer may terminate the contract for any reason.
On the first business day after the contract date, the risk on the subject property is transferred to the buyer. The buyer should telephone his chosen insurance broker so that the latter may issue a certificate of insurance immediately. If the buyer is obtaining finance, this matter should be communicated to the insurance broker so that the bank may be noted on the insurance policy as a first mortgagee.
It is also necessary to conduct a title search to ensure that the buyer gains good title to the property bought. It is also essential to carry out other searches which may reveal any matter adversely affecting the property.
After the contract has been signed, and if a search conducted reveals that the property is adversely affected because: (1) the present use is not lawful; (2) the land is affected by a proposal of a competent authority; (3) access or any services to the land passes unlawfully through other land; (4) an authority has issued a current notice to treat, or notice of intention to resume; or (5) the property is affected by the Queensland Heritage Act 1992 or is included in the World Heritage List, and these facts are not disclosed in the contract, the buy is entitled to terminate the contract up to 2 business days prior to settlement date. The buyer should seek the advice of the solicitor regarding which search to take.
As searches do not often disclose error in boundaries or physical encroachment on the land, a survey may be conducted. The buyer may engage the services of a surveyor for this matter. Adverse observations made by the surveyor must be communicated to the solicitor since this is a ground for termination of the contract or for damages.
Foreign ownership should be communicated to the solicitor. If the buyer is a foreign person or a trustee of a foreign company or trust, the buyer needs to obtain the consent of the Foreign Investment Review Board under the Foreign Acquisition and Takeovers Act 1975. It is essential to include a Special Condition to make the contract subject to the foreign buyer obtaining consent from the Foreign Investment Review Board.
After the contract has been signed, the buyer is entitled to enter the property twice:
(1) Once for the obtaining the pest and building inspection; and
(2) Once for the purpose of conducting pre-settlement inspection. It is the buyer’s responsibility to contact the seller or his agent to arrange the date for inspection. It is suggested to set the date closer to the date of settlement and ensure, among other things, that no fixture included in the contract is removed and the check the condition of the property.
Prior also to the settlement date, it is recommended that the buyer lodge a Form 23 Settlement Notice with the Department of Environment and Resource Management. The effect of this notice is to protect the buyer’s interest in the property by prohibiting the registration of any conflicting interest in the property between period of settlement and registration of the transfer.
Prior to settlement, all transfer documents must be prepared and signed, relevant searches conducted and transfer duties attended to. The settlement must take place by 5 p.m. on the date of settlement. The solicitors will arrange for the cheques to be issued by the buyer or buyer’s financier. In exchange of the cheques, the financier takes the transfer documents and release of mortgage. If there is no finance involved, the buyer’s solicitors take the transfer documents and release of mortgage, and register the same.